Iron ore: Production restrictions have been implemented successively, and iron ore prices have fluctuated at low levels.
Opinion and logic:
Yesterday, both the open interest and trading volume of the most-active iron ore contracts dropped sharply and iron ore prices fluctuated at low levels. The closing price reported 1,165 yuan/ton, down 8.5 yuan/ton, or 0.72%. Qingdao Port PB fines reported 1,485 yuan/ton, an increase of 3 yuan/ton, SSF reported 1,050 yuan/ton, an increase of 5 yuan/ton, and the spread between high and low grade products was 435 yuan/ton. Yesterday, the main ports’ transaction volume was 710,000 tons, a week-on-wek decrease of 190,000 tons/day.
On the whole, the domestic and international supply and demand of iron ore have been in a tight balance since the beginning of this year, supporting the strong operation of iron ore prices all the way. In May, the State Council investigated the high prices of bulk commodities, and the price of iron ore subsequently dropped, but now it has returned to and maintained at a relatively high point. In the short term, as approaching the celebrating of the 100th anniversary of the founding of the China Communist Party, the steel and coal sectors have started to stop production for 1-2 weeks and the impact on iron ore is expected to be relatively small. Looking ahead, the policy of restricting crude steel production across the country has begun to be gradually implemented, and the iron ore price in the second half of the year will most likely be weaker.
Unilateral: tend to be bearish in the medium term
Cross-species: go long positions of thread and hot-rolled coil and short positions of coke and iron ore (the raw material end)
Spot-Futures Arbitrage: None
Concerns and risks:
1. The implementation of the policy of limiting production at the thread and hot-rolled coil end;
2. Domestic and overseas steel demand may weaken at the same time;
3. Iron ore shipments, etc.
Rubber: Demand is weak and raw material prices continue to decline.
On June 30, the most-active RU contract closed at 12,800 (-45) yuan/ton, the price of mixed rubber reported 11,875 (-25) yuan/ton, and the basis of most-active contract stood at -325 yuan/ton (-255); the open interest of top 20 actively traded long positions was 113,794 (+3,048) lots, the short position was 163,094 (+3,565) lots, and the net short position was 49,300 (+517) lots.
On June 30, the most-active NR contract closed at 10,340 (-130) yuan/ton, the STR in Qingdao Free Trade Zone reported 1,640 (-20) US dollars/ton, the SMR stood at 1,635 (-10) US dollars/ton, and the SIR figure was 1,600 (-10) US dollars/ton. The basis of most-active contract reported -4 (+71) yuan/ton.
As of June 25: the total inventory of domestic exchanges was 183,534 (+930) lots, and the amount of warehouse receipts of exchanges was 174,820 (+190) lots.
Raw materials: Sheet rubber 55.1 (-1.5), cup lump 43 (-0.5), latex 48.5 (-1), RSS3 56.85 (-0.77).
As of June 24, the operating rate of domestic all-steel tire factories was 64.13% (+7.21%), and the operating rate of semi-steel tire factories was 58.95 +6.2(%).
Opinion: Yesterday, rubber futures prices remained weak. With weaker demand and gradual increase in output, the price of raw materials in Thailand's main producing areas continued to decline. This week, due to domestic environmental inspections, tire factory overhauls have increased, and the continued decline in operating rates has made the market expected to further weaken the demand for raw materials. The domestic Qingdao port inventory announced this week continued to decline, but spot prices were still weak, reflecting unsatisfactory demand. Major overseas production areas have gradually increased the delivery volume, and the prices of raw materials have continued to decline. The expectation of the peak supply season is enhanced, and prices are operating at a weaker pace under the weak supply and demand pattern. When the price is low, it is not recommended to increase the short position too much.
Risk points: production may increase sharply, inventory may continue to accumulate, and demand may fall sharply.
Crude oil: Saudi Arabia and Russia disagree over whether to increase production.
The JMMC meeting originally scheduled for Wednesday was postponed by one day. More market news indicates that the differences between Saudi Arabia and Russia have increased for the August production increase plan. Saudi Arabia tends to be cautious and slightly increase the production, while Russia hopes to increase production by a larger margin. Russia's considerations are mainly based on the impact of oil prices on domestic inflation. Saudi Arabia and Russia need more communication and negotiation. We expect that the final compromise between the two parties will result in a slight increase in production. We expect OPEC's production increase in August will not exceed 1 million barrels per day. The current market mainstream expectation is to increase production by about 500,000 barrels per day, but even if it increases production by 1 million barrels per day, it will be difficult to change the current situation in which supply exceeds demand in the crude oil market. The reasons why OPEC is difficult to increase production significantly are the following three points: 1. The uncertainty of Iranian oil's return to the market; 2. The current global stocks have not yet fallen to the pre-epidemic level; 3. The mutant strains bring uncertainty to the recovery of demand.
Strategy: neutrally, tend to be bullish in the short term; go long positions of INE crude oil and short positions of Brent or WTI futures
Risks: The Iranian nuclear agreement may be reached quickly or OPEC may increase production beyond expectations.
Copper: The employment data in the US was better than expected, and copper prices strengthened.
In terms of spot: According to SMM news, the price of Shanghai copper market generally rose yesterday, and the spot market first declined and then rose. On the last trading day at the end of the month, most companies are already in the process of settlement, while most market participants were holding a wait-and-see attitude, reporting quotation at the original level. Standard-Grade Copper was quoted at a premium of 50 yuan/ton, and High-Grade Copper stood at a premium of 60-80 yuan/ton. However, there are still some spot-exchangers whose quotations were very low, and a small number of companies that are still in the process of replenishment on the last day hold down prices to buy Standard-Grade Copper at a premium of 10-20 yuan/ton, and buy High-Grade Copper at a premium of 50 yuan/ton. After the second trading session, the inter-month stagnated at 100-120 yuan/ton for two weeks, and finally there was a change of about 200 yuan/ton again. This has aroused market attention and interest. Some traders entered the market to purchase goods, and soon it was difficult to find a source of goods with a premium of less than 20 yuan/ton. However, the transaction of Standard-Grade Copper with a premium of more than 40 yuan/ton was still difficult. High-Grade Copper has not yet been favored, and the spread with Standard-Grade Copper is only 10-20 yuan/ton. Hydro-Copper has fewer and firmer quotations due to lack of supply, and holders were reluctant to sell, and its spread with Standard-Grade Copper was only 10-20 yuan/ton.
Opinion: Yesterday, the ADP employment data in the United States recorded unexpected results, which made the US dollar index continue to rise, while copper prices were also boosted. However, as the current fundamentals have not changed much, copper prices have always presented a situation where the upper limit is under pressure and the lower limit is supported. Therefore, under such circumstances, copper prices are expected to remain volatile.
In the medium and long term, macroeconomically, the global central banks will continue to maintain the current ultra-loose monetary and fiscal policies in the short term. Although the U.S. dollar has moved strongly after the interest rate meeting, it is largely an overdraft for future economic growth. In terms of fundamentals, the current TC price continues to rise, coupled with the domestic rumor of tapering, so the supply side has a relatively negative impact on copper prices. On the demand side, China’s current control of the epidemic is still very successful, and the new energy and new infrastructure sector will continue to drive copper demand. However, due to the current market interference from the rumors of the Federal Reserve tapering and the possible tightening of central bank liquidity around the world, in general, we recommend that investors maintain a relatively neutral attitude.
1. Unilateral: neutrally
2. Inter-market: postpone
3. Inter-period: postpone
4. Options: postpone
1. The Fed's monetary policy orientation
2. The trend of the US dollar index
3. Whether the demand in the second quarter can meet expectations
4. Policy risks may increase.
PTA: The production and sales of filament are sluggish, and there is no continuous replenishment of the terminal.
Balance sheet outlook: Under the background of the implementation of TA overhaul, the accumulating rate in July is relatively controllable, and TA processing fees are still acceptable in the short term; the accumulation rate of PX inventory from June to July is limited, and it is expected that PX processing fee compression space is limited.
Strategic recommendations: (1) Unilateral: cautiously bullish (2) Intertemporal: under the circumstance that the price difference of 9-1 has rebounded sharply recently, waiting for the intertemporal reverse arbitrage opportunities.
Risks: The implementation of the PTA plant maintenance plan, the strength of the negative feedback of the maintenance of polyester filament, and the sustainability of the improvement in the supply and demand of aromatics due to the gasoline premium.
铜： 美国方面就业数据好于预期 铜价一度走强
1. 单边：中性 2. 跨市：暂缓 3. 跨期：暂缓；4. 期权：暂缓
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